N.Y. Fed: Service sector showing signs of rising inflation

Prices paid and received increased in February, and wage growth also grew in the month, according to the Federal Reserve Bank of New York's February Business Leaders Survey, released Friday.

The New York region's service sector activity "continued to grow at a solid pace," the release noted. “The business climate index rose five points to 21.1, a record high, signaling that firms, on balance, regarded the business climate as better than normal,” the report noted.

The business activity index slipped to 15.9 in February from 18.1 in January, the business climate index gained to 21.1 from 16.4, the number of employees index grew to 15.5 from 10.5, the wages index climbed to 41.7 from 37.1, the prices paid index gained to 56.1, its highest level since 2014, from 49.3, the prices received index increased to 20.5 — “its highest level in more than six years” — from 16.6, and the capital spending index rose to 21.5 from 14.8.

The future business activity index grew to 50.0 in February from 47.2 in January, the business climate index rose to 38.6 from 35.4, the number of employees index increased to 34.4 from 29.2, the wages index declined to 53.0 from 55.8, the prices paid index fell to 57.0 from 61.2, the prices received index climbed to 37.5 from 34.2, and the capital spending index gained to 30.1 from 26.1.

Respondents to the Business Leaders Survey, which the Fed calls “a close cousin of our Empire State Manufacturing Survey,” come from New York, northern New Jersey, and southwestern Connecticut.

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